Thursday, March 08, 2007

Your Team of Professionals - part 3 in a seriesWithout a select group of professionals, purchasing a home would be almost impossible. A good way to start looking for any professional is to ask for referrals from satisfied friends. You will require the services of:1. A Real Estate Representative to look after your interests.2. An appraiser to independently assess the market value of the home. Check for the appraiser’s qualifications and licence.3. A Lender – financial institution or mortgage broker. Of course, we’re partial to our Scotiabank Mortgage Partner.4. A Lawyer to ensure your legal interests are being protected. Your legal representative will process all the official paperwork and arrange the disbursements and title upon closing.5. A Home Inspector to independently assess the quality and condition of the home’s systems and structure. Check for the inspector’s qualifications and licence.6. An Insurance Broker for your home insurance – you won’t get the lender’s money without it!

Taking out a mortgageBuying a home usually means taking out a mortgage. That means you borrow money to buy a home, using that home as collateral for the loan. Mortgages today can be 100% funded and amortized over periods of up to 35 years. Variable and fixed rate, open and closed terms, split mortgages and different payment options – many decisions best left to you and your lender to discuss and tailor to your financial situation.Be prepared to provide plenty of personal information. They need to fully assess your ability to repay the loan using your GDS and TDS ratios and they’ll need documents pertaining to your assets, liabilities, earnings and employment history as well as permission to do a full credit history check.

The approval process may take a couple days, but allow for a couple of weeks. An application for mortgage loan insurance will be submitted to the mortgage insurer to approve (or reject), but final approval is still subject to a review of the property and a credit review of your finances.It’s best to start with a pre-approval from your lender. This gives written approval for an amount and establishes an interest rate guaranteed for a certain period of time. It gives you a head start on house hunting.